Peacocks prompts growth plan for Woollen Mill
The Langholm-based company revealed its plans after posting a surge in both sales and profits thanks to an updated online strategy and the contribution from Peacocks, which it bought out of administration early last year.
Accounts for the year to 31 March showed that the group grew turnover by 130.7 per cent to £566.7 million, and increased operating profit by 184 per cent. Profits of £58.5m compare to £20.6m a year earlier.
Like-for-like sales in the underlying business, which incorporates the EWM and Ponden Home brands, increased by 1.2 per cent, with online sales up 57.5 per cent. The business also continued a roll-out programme that saw it open 56 stores and create 920 jobs during the year.
EWM has pursued a strategy of “bricks and clicks”, integrating its online operation with its large network of stores, and sees further scope for expansion on the ground.
A spokesman for the retailer said: “The group estimates it will open up to 20 stores in Scotland over the next 18 months, creating almost 250 jobs.”
Commercial director Steve Simpson said the UK high street remains “a tough environment” and the company is focusing on serving customers who are “seeking value at a time of reduced discretionary spend”. Management has also taken a keen interest in cost control.
Simpson hinted that the group is likely to look further afield for more rapid growth, and may be prepared to take on debt in order to do so.
He said: “The group is free of debt so we can leverage a positive balance sheet and focus on a sensible strategy that continues to deliver sustainable growth for the long term.
“The natural next step for us is to take this approach to robust international markets such Germany, the Middle East and Russia.”
Across all its operations, the group plans to open a further 100 stores and create 1,145 jobs over the next 18 months.
That follows the addition of 30 outlets in the past six months, during which time like-for-like sales growth picked up to more than 5 per cent.
Management has also been focused on turning around the Peacocks chain, which went into administration in January 2012.
Since buying Peacocks, the group has invested £80m in re-focusing the brand, putting the focus on “quality over discounting” and developing its online sales channel.
It has also re-fitted key stores and enhanced Peacocks’ overseas presence, where it now operates 93 sites.
The strategy delivered a double-digit increase in like-for-like sales at Peacocks, which has secured more than 9,000 UK jobs across 440 stores and the brand’s head office.
The successful turnaround means that Edinburgh Woollen Mill Group, which was founded in 1946, now operates more than 1,000 stores and employs in excess of 12,000 people.